BACKGROUNDER - ICSI Banking... · and the Reserve Bank of India was established to regulate the formal banking sector in the country. Ever since the banks were nationalized in 1969,

BACKGROUNDER

Indian Banking Sector -Initial Public Offering Scenario

andits Impact

November 2017

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Printed at Chandu Press /200/November 2017(ii)

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PREFACE

Banking sector plays a significant role in the functioning anddevelopment of the economy. In India too, banking sector is contributingimmensely towards the objective of financial inclusion. In this regard,banks need capital infusion for their organic growth. Further, there is acuriosity to ascertain the future trend of IPO issues of both public andprivate sector banks, as with the passage of time private sector bankstoo have captured center stage in Indian economy.

This book attempts to delve deep into various facets of IPO issues andits impact in the perspective of Indian banking sector. The impacts havebeen studied on the crucial dimensions, namely, return on Assets; InitialReturn or Raw Return and Market Adjusted Excess Return on the selectedpublic and private sector banks from the date of their listing to certaintime horizons. Further, as it is an accepted truth that profit is the oxygenfor any form of business and so an analysis have been done to studycorrelation between Reported Profit After Tax (PAT) and IPO values ofselected public and private sector banks to know whether there is apositive or negative correlation between the two variables.

Initial Return and Market Adjusted Excess Return assist in ascertainingthe returns generated by the stock post listing. As the shareholders wealthmaximization has gained substantial significance, the aforesaid methodshelp to know whether the shareholders of the selected banks standsbenefitted or not, after the listing of their IPOs. Return on Assets beingan important financial yardstick, have been applied to observe whetherthere is a significant difference or not in the return on assets of selectedpublic and private sector banks. Another important area of focus iscorrelation between IPO values of selected banks and non-performingassets, to ascertain whether there exists a positive or negative correlationbetween the aforesaid variables. In other words, through correlationanalysis an effort has been made to ascertain whether IPO issued doexert any positive impact on meeting the loss due to non-performingassets.

We are thankful to CS Shailashri Bhaskar, Former DGM, SEBI and PracticingCompany Secretary, Mumbai for reviewing the book and providingvaluable academics and research inputs

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I commend the dedicated efforts of Mr. Akinchan B. Sinha, AssistantDirector, ICSI for preparing the manuscript of this research publicationwith the help of statistical and financial tools under the guidance of CSSonia Baijal, Director, ICSI.

I am certain that the book will be of immense academic and researchvalue to Company Secretaries both in practice and employment,professionals representing professional bodies, industry and studentspursuing Company Secretaryship and other professional courses.

I wish readers a Happy Reading!

CS (Dr.) Shyam Agrawal President

The Institute of Company Secretaries of India

Place: New Delhi

Date: November 02, 2017

C O N T E N T S

Chapter 1 1

INTRODUCTION

Chapter 2 16

IPO TRAJECTORY OF BANKS & CRITICAL ASPECTS

Chapter 3 30

GAUGING IPO PERFORMANCE

Chapter 4 42

THE REGULATORY ECOSYSTEM

Chapter 5 75

GROWTH PROSPECTS FOR IPO

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Banking Sector- Fulcrum of Indian Economy

Banking sector plays a crucial role in the functioning and economic development of aneconomy. In all economic systems, banks play a leading role in planning and implementingfinancial policy. The difference lies in prioritizing goals and methods embraced for theirattainment. Going by the neo-liberal approach, earning higher profits by utilizing allresources is an end in itself, while in the socialistic systems bank operations also aims atimproving economy in general and at satisfying social needs.

Banks accepts deposits and provide loans and derive a profit from the difference in theinterest rates paid and charged to depositors and borrowers respectively. The processundertaken by banks of taking in funds from a depositor and then lending them out toa borrower is termed as financial intermediation. Banking sector flourish on the financialintermediation capabilities that allow them to lend out money and receiving money ondeposit. The bank is the most significant financial intermediary in the economy as itbridges the gap between surplus and deficit economic agents.

Banks contribute immensely towards the economic development of a nation by facilitatingbusiness activities. Banks also facilitate the development of saving plans and hold a keyposition in the determination of Government’s monetary strategies.

With reference to India, banking sector is substantially different from that of otherAsian nations because of country’s distinct geographic, social and economic facets.India possess a gigantic land size, a diverse culture, and extreme income differences,which are marked among its regions. There are high levels of illiteracy among a substantialpercentage of populace but at the same time, the country has a huge pool of managerialand technologically advanced talents. Approximately 30 to 35 percent of the populationlives in metro and urban cities while the rest of population resides in semi-urban andrural areas. The country’s economic policy structure is a combination of both socialisticand capitalistic characteristics with a heavy bias towards public sector investment. India’semphasis on growth-led exports rather than “export led growth” of other Asianeconomies, with thrust on self-reliance through import substitution and aforesaid featuresare all reflected in the structure, size, diversity of the country’s banking and financialservices sector.

Towards the dawn of the 20th century, with the arrival of modern industry in our country,the need for government regulated system was realised. The British Government beganto pay attention towards the requirement for an organized banking sector in the countryand the Reserve Bank of India was established to regulate the formal banking sector inthe country. Ever since the banks were nationalized in 1969, banks have been playing a

1

Chapter -1

Introduction

Indian Banking Sector - Initial Public Offering Scenario & its Impact2

crucial role in the socio-economic life of the country. Their role was not only restrictedto suppliers of credit, but also as harbingers of social and economic developmentthrough various enterprises, many of which were tiny but possess phenomenalcapabilities.

It is noteworthy that India is one of the emerging economies of the globe and paucityof proper banking services will jeopardize its economic growth. In past several decades,Indian banking sector have attained numerous milestones. Its operations are no longershackled in big cities, rather they have expanded their wings to Tier-II & III towns andfar flung areas of India, thereby contributing immensely towards the objective of ‘FinancialInclusion’.

Banks have diversified their activities and forayed into new products and services thatinclude opportunities in credit cards, consumer finance, wealth management, life andgeneral insurance, investment banking, mutual funds, pension fund regulation, stockbroking services, custodian services, private equity and so on and so forth. Further,several leading Indian banks have forayed into offshore markets by establishing officesin foreign countries, by themselves or through their subsidiaries.

Growth of Indian banking sector and the role it is playing in adding steam to theeconomic growth is evident from the deposit and credit statistics (please refer exhibit1 & 2). It can be observed from the exhibits that deposits have taken a giant leap fromUS$ billion 495 in FY06 to US$ billion 1,466 in FY16, whereas, Credit soared fromUS$ billion 428 in FY07 to US$ billion 1016 in FY16. Deposits under Pradhan MantriJan Dhan Yojana (PMJDY) are rising. As on November 09, 2016, US$ 6,971.68 millionwere deposited, while 255.1 million accounts were opened.

Exhibit 1

Healthy Growth of Banking Sector- Deposits

Indian Banking Sector - Initial Public Offering Scenario & its Impact 3

Exhibit 2

Healthy Growth of Banking Sector - Credit

Thus looking to the prodigious growth of Indian banking industry, it generates paramountacademic and research interests to delve deep into the sources of long term finance ofbanking sector, especially through IPO. The study will cover IPO (Initial Public Offer),FPO (Follow-on Public Offer) and OFS (Offer for Sale).

Contribution towards Financial Inclusion

India has nearly 600,000 villages and 640 districts. A substantial chunk of population,particularly in rural areas, is excluded from the convenient access to finance(Gounasegaran, Kuriakose & Iyer, 2013). Forty percent of the households having bankaccounts, but merely 38 percent of the 117,200 branches of scheduled commercialbanks are functioning in rural areas. Accessibility of financial services at affordable andapposite prices has always been a global issue. Hence, a need of inclusive financialsystem has been felt in a broader way not only in India, but has become a policy priorityin different countries. It is a well accepted fact that financial access can play a big rolein improving the financial conditions and living standard of the poor and the deprivedclass. In view of this, RBI has been constantly fostering the banking sector to extend thebanking network both by establishing new branches and installation of new ATMs (Dangi& Kumar, 2013).

Financial inclusion implies the delivery of financial services, including banking servicesand credit, at a reasonable cost to the majority sections of the disadvantaged and low-income groups, based on the magnitude of their access to financial services like savingsand payment account, credit insurance, pensions etc. (Singh et al., 2014).

The various financial services cover access to savings, loans, insurance, payments andremittance facilities provided by the formal financial system. This facet of financialinclusion is of big significance in offering economic security to individuals and families(Kelkar, 2014). It is heartening to note that Financial Stability and Development Council(FSDC) of India have a specific mandate for financial inclusion and financial literacy.


Providing fillip to the concept of financial inclusion, a broad network of financial institutionshas been set up over the years. The measures initiated by the Reserve Bank of India(RBI) and the Government of India towards strengthening financial inclusion since thelate 1960s have significantly improved the access to the formal financial institutions.RBI set up a commission (Khan Commission) in 2004 to look into Financial Inclusionand the recommendations of the Commission were included into the Mid-term reviewof the policy (2005-06). In the report RBI insisted upon “no-frills” banking account inorder to attain greater Financial Inclusion.

It can be said without an iota of doubt that efforts invested for stimulating financialinclusion have delivered fruits and it is manifested in the number of households (as per2001 and 2011 census) subscribing to banking services and growth in the number ofbranches of public sector banks-Population Group Wise (please refer exhibits 3 and 4).

Exhibit 3

Comparative statement of number of households availingbanking services as per

Census 2001 & 2011

Source: Department of Financial Services, Ministry of Finance, Government of India

Exhibit 4

Number of functioning branches of Public SectorBanks-Population Group Wise

As on Rural Semi Urban Urban Metropolitan Total

31.03.2011 20658 16217 13450 12612 6293731.03.2012 22379 17905 14322 13244 6785031.03.2013 24243 19642 15055 13797 7273731.03.2014 27547 21952 16319 14644 80462

31.03.2015 29634 23549 17387 15325 85895

Source: Department of Financial Services, Ministry of Finance, Government of India


Literature Review

Indian capital markets have displayed a prodigious growth in the post liberalization eon.It remains one of the most pliant globally and poised to be one of the top destinationsfor domestic and global businesses to expand and invest into. Procuring capital is astrategic priority across India and role of Capital Markets has assumed far greaterimportance and urgency. Much has happened in the Indian capital market in more thana decade. With its foundations laid in socialist based economy of four decades, withstringent government control over private sector participation, foreign trade and foreigndirect investment, India opened its doors to the globe in the early 1990s. Since then itseconomy and financial markets witnessed drastic changes, largely in response to theeconomic crisis of the late 1980s. The government control on foreign trade and investmentwere relaxed and the blockades to entry in the days of licence raj were relaxed.

The birth of Securities and Exchange Board of India (SEBI) as the supreme capital marketregulator displayed India’s commitment to come across as a robust economic force,through setting up of market best practices of increased corporate disclosure and enhancedinvestor protection.

Important reforms were initiated in the regulation of the securities market since 1992 inconjunction with the overall economic and financial reforms. A significant componentof the reform strategy was building a robust independent market regulator. The SEBIAct, which was enacted in early 1992, established SEBI as an autonomous body. Theapex capital market regulator was empowered to regulate stock exchanges, brokers,merchant bankers and market intermediaries. The Act provided SEBI the requisite powersto ensure investor protection and orderly development of the capital markets.

The initiation of free pricing in the primary capital market has substantially deregulatedthe pricing control instituted by the erstwhile CCI regime. While, the issuers ofsecurities can now procure capital without taking approval from any authority pertainingto pricing, however the issuers are needed to adhere to the SEBI guidelines forDisclosure and Investor Protection, which, in general, cover the eligibility norms formaking issues of capital (both public and rights) at par and at a premium by differenttypes of companies.

The freeing of the pricing issues resulted to an unprecedented increase of activity in theprimary capital market as the corporate mobilized mammoth resources. However, it didexpose the insufficiencies of the regulations. In order to address these inadequacies,SEBI strengthened the rules for public issues in April 1996.

SEBI introduced the theory of IPO grading, done by a credit rating agency registeredwith SEBI, for all primary market issues, who file their draft Red Herring Prospectus, onafter 1st May, 2007. The grading is done after taking into account governance structureand financial strength.

Numerous studies have observed the performance of initial public offerings (IPOs) inseveral markets. These studies document that the initial under-pricing is a commonphenomenon in every stock market, with the amount of under-pricing varying from onemarket to another. The majority of studies include the equity markets of US (Ibbotson1975), (Ritter 1984), (Ritter 1991), (Aggarwal and Dahiya 2000), (Tinic, 1989), (Peavy1990), (Loughran, Ritter et al. 1994), UK (Keasey and H. 1992; Levis 1993), Germany


(Uhlir 1989; Ljungqvist 1997), Canada (Jog and L. 1987) (Suret, Cormier and Lemay,1990), (Falk and Thornton 1992), (Jog and Siristrava 1994; Jog 1997; Kooli and Suret2001), China (Dongwei and Fleisher, 1999), Switzerland (Kunz and Aggarwal 1994),Australia (Lee, Taylor et al. 1996). There are relatively lesser studies on IPOs in theequity markets of non-European countries. Among them, (Lee, 1996) investigates IPOsin Singapore; (Kim, 1995) in Korea, (Aggarwal, Leal et al. 1993) in Chile, Mexico andBrazil; (Firth and Liau-Tan 1997) in New Zealand, (Laiw, Liu et al. 2000) for Taiwan.These studies also report the existence of the initial under-pricing in these markets.

Ajay Shah (1995) studied the basic time-series properties of the number and value ofIndian IPOs per month, variation in issue and listed price, factors leading to delay inlisting, and modelling the cross-sectional variation of issue and listed price. 2056 IPOstraded and listed during 1991 – 1995 were chosen by the researcher in which 1819(88.5%) provided positive returns from issue date to listing date and aggregate variationbetween issue price and listed price was 105.6%. Time series analysis showed aremarkable rise in the number of IPOs per month from 20 a month before the abolitionof Controller of Capital Issues in May 1992 to the region of 80 a month from the laterpart of 1993 onwards due to the commencement of free pricing of securities.

Arwah Arjun Madan (2003) assessed the long run performance of IPOs in the Indianprimary market during the pre and post liberalization eon. A sample of 1597 companieshaving made IPOs during 1989 to 1995 at Bombay Stock Exchange, now BSE Ltd. werestudied. Considering the net return, 79.4% of the total 1597 IPOs recorded a positivereturn on the listing day and 20.6% of IPOs registered negative returns.

Ajay Pandey (2005) studied initial returns (difference between issue price and listingprice) and long run performance of IPOs. The researcher considered 84 IPOs from theperiod 1992-2002, coming out with fixed price and book building trajectory from theIndian capital market. The study revealed that the IPOs offered through fixed pricemethod raised only a small amount of capital. On the contrary, IPOs offered throughbook building approach mobilized. It was further observed that IPOs offered throughboth fixed price and book building approach under performed in the first two yearssubsequent to listing.

Kumar (2007) analyzed the short-run and long-run performance of IPOs issued throughbook building method. For the analysis, offer to close return, open to close return, buyand hold market adjusted return and monthly market adjusted returns were computedfor 156 IPOs listed from 1999 to 2007. It was found that in the short-run, IPO listingdidn’t provide economically significant trading opportunities for day traders and in thelong-run, IPOs beat the market after two years of listing.

Shikha Sehgal & Balwinder Singh (2007) investigated the initial and long-run performanceof 438 IPOs listed on the BSE from 1992 to 2006. To observe the long-run performanceof Indian IPOs, Buy-and-Hold Abnormal Returns (BHAR) and Cumulative AbnormalReturns (CARs) were computed for 120 months. Buy-and-hold returns were found tobe negative between 18 and 40 months of holding. After 40 months, theunderperformance of IPOs has vanished, i.e. in India, underperformance persists fornearly one-and-a-half years to a little above three years.

Priyanka Singh & Brajesh Kumar (2008) conducted an investigation on the short as well


as long-run performance of the Initial Public Offerings in the Indian Capital Market.The study proposed an approach taking oversubscription variables along with age andissue size to explain the performance of IPOs in India. Since various sectors have variedlevel of private and public information, the researchers performed industry wise analysis.The period for the study was 22 months (Jan, 2006- Oct, 2007) considering 116 IPOs.It was observed that both short and long run return of IPOs are positive for this period.In the short run, only 18% of IPOs lisited price was more than offer price and in thelong run, it was only 11.5%. Oversubscription variables, namely, total oversubscription,institutional investors and retail investors oversubscription, were found to be the maindeterminants for listing and offer price performance of Indian IPOs. Infrastructure,financial and entertainment sectors with positive long run return fell under this categoryfor the period of study. On the contrary, IT sector gave higher initial return but negativereturn in the long run.

Seshadev Sahoo and Prabina Rajib (2010) attempted to specify the relationship betweenpost-issue promoter groups’ retention and IPO performance on listing . The researchersinvestigated the impact of financial variables,i.e., offer size, times subscribed, age ofthe firm, book value, leverage, market volatility, ex-ante uncertainty and the post issuepromoter group holding on listing performance of an IPO. 92 IPOs from manufacturingand non manufacturing sectors were used as sample and found that in 46.55% of IPOs,lisiting price was more than the offer price during 2002 - 2006. The study documenteda positive relationship between post-issue promoter group holding and IPO performanceon listing . The results further indicated that offer size, times subscribed and post-issuepromoter group holding were statistically significant in influencing the performance oflisting.

Bandgar & Atul Rawal (2012) studied the impact of pricing of Banks IPOs in long andshort run. The researchers also evaluated the effect of size and issue nature (par, premiumor at discount) of IPOs on its pricing. A sample of 10 banks were selected randomlywhich issued their equities through initial public offering (IPO) during the period 2000– 2010.It was found that the average return in short run was at - 8% and long run wasat - 53%. Further findings from the study revealed that big issue size IPOs got listedwith a higher listing price and the small issue size IPOs got listed with a lower listingprice. IPOs with lower issue price gave more returns on the listing day than the IPOswith higher issue price. Private sector banks IPO’s gave higher return than the publicsector banks IPOs during the study period.

Ganesamoorthy & Shankar(2012) attempted to study the price behaviour of IPOs and itspersistent effect after listing . For this purpose a standard event study methodology bytaking market adjusted return model was used. As per the methodology, Annual averageabnormal return (AAR) and cumulative average abnormal return (CAAR) were calculatedalong with the t-statistics for testing significance. The study covered a ten years period from2001 to 2010. 219 initial public offerings made by Indian companies during the period wereselected as sample for the study. The overall result indicated that the issue price was morethan listed price for the Indian IPOs during 2001 to 2010. Even though the AAR on the firsttrading day was more than one per cent, in the subsequent days the price was adjusted bythe market. CAAR at the end of the event window (75th day) stood at -10.7 per cent. Thenegative CAAR of 68 days out of 75 days were found to be significant, which stronglyindicate the underperformance of Indian IPOs during the period.


Baluja Garima(2013) observed the efficiency of IPO grading mechanism by using asample of 50 graded IPOs listed with BSE from 2007 to 2010. The researcher identifiedthat the IPO grading is not an effective mechanism in reducing information asymmetry.The One Way ANOVA result exhibits no significant difference in listing price performanceof the different graded IPOs. Hence, listing price performance of different graded IPOsvaries due to chance or due to some other factors such as subscription level, Issue size,age of the firm etc. but it was irrespective of level of grades obtained by IPOs.

Equity Scenario of Public and Private Sector Banks

Before proceeding to the capital raising scenario of public and private sector banks inIndia by espousing the IPO trajectory it is pertinent to have a brief discussion on PrimaryMarket in India and Initial Public Offering. A sound capital market is an importantprerequisite for the industrial and commercial development of a country. Capital market isa central coordinating and directing mechanism for free and balanced flow of financialresources into the economic system functioning in a country. It assist the corporate housesin need of capital to expand, modernize or diversify their business. To obtain the capitalthat is needed by the company it usually embrace the primary market for issue of sharesand the process of issuing shares is done in the primary market. The primary market in asimple way can be defined as a market where the securities are issued to procure funds orcapital require by the company. It is a market for new issues, i.e. a market for freshcapital. It provides the medium for sale of new securities. The securities can take differentforms, such as, equity shares, preference shares, debt instruments, bonds etc.

A company may raise capital in the primary market with the help of IPO, rights issue orprivate placement. An Initial Public Offer (IPO) is the selling of securities to the publicin the primary market. It is the biggest source of funds with long or indefinite maturityfor the company. “An initial public offering (IPO), referred to simply as an "offering" or"flotation", is when a company (called the issuer) issues common stock or shares to thepublic for the first time.”

The Reserve Bank of India in 2010 stated that private sector banks should take itsapproval before espousing the IPO route, preferential issues, or qualified institutionalplacement. It was mandatory for private sector banks to approach RBI for prior ‘inprinciple’ approval in case of qualified institutional placements. Banks required to approachRBI along with details of the issue once the bank’s board gave nod to the raising ofcapital through IPO route.

Public sector banks were permitted to procure capital from the capital market to fortifytheir capital adequacy ratios and bring down the government holdings. The BankingCompanies (Acquisition and Transfer of Undertakings) Act, 1970/ 1980 and State Bankof India Act, 1955 were amended to permit banks to raise capital not more than 49percent of their equity.

The State Bank was the first public sector bank to tap the equity market in December1993. In October 1996, it once again knocked the doors of the capital market througha GDR issue of INR 1,270 crores. With these two issues, the holdings of the RBI slashedto 59.7 percent in State Bank of India. Over the years 1993 to 2001, 12 PSBs procuredcapital through IPO trajectory to the extent of INR 6,501 crore. The market respondedpositively to public sector banks IPOs. The year 2002 witnessed the IPO market dominated


by public sector banks. During the year ended March 2002, Punjab National Bankcollected INR 390 crore through IPO path. Consequent upon this issue, the shareholdingof the Central Government declined to 80 percent. During 2002-03, three PSBs namely,Union Bank of India, Allahabad Bank, and Canara Bank collected INR 288 crore, INR100 crore, and INR 385 crore in August, October, and November 2002 respectively. InUnion Bank of India and Allahabad Bank, the holding of Central Government was reducedto 60.9 percent and 71.2 percent respectively. During 2003-04, four public sectorbanks, namely, UCO Bank, Indian Overseas Bank, Vijaya Bank and Bank of Maharashtra,issued equity worth INR 950 crore. With these, the total amount of capital procured byPSBs through equity issues touched INR 8224 crore till end March 2004. During 2005-06, six public sector banks and five private sector banks procured INR 11067 crorethrough public issues of equity shares. Both the public and private sector banks raisedINR 30151 crore through private placements.

By referring Exhibit 6, issue of IPO by Banking / Financial Institutions during the period2001-01 to 2014-15 can be observed. IPO issue (value-wise) was highest in the year2011-2012- INR 35,611 crore, whereas the IPO issue (value-wise) was at its lowestduring April1st 2014 to December 2014- INR 427 crore. Volume wise, IPO issue washighest in the year 2010-11, i.e. 18, whereas it was nil during two periods, i.e. 2008-09 and April 1st 2015 to December 2015. Volume wise a huge dip in IPO issue can beobserved during the periods 2006-2009. In 2005-06, IPO issue was 12, which wentdown to 05 in 2006-07 and further it reached nil during 2008-09. However, a substantialimprovement can be observed in 2010-11 with IPO issue reaching 18.

Exhibit 5

IPO Issues of Banking / Financial Institutions

Years No. of IPOs Amount (INR Crore)

2003-04 19 3191.10

2004-05 23 14662.32

2005-06 76 10797.88

2006-07 76 23706.16

2007-08 84 41323.45

2008-09 21 2033.99

2009-10 39 24948.31

2010-11 52 33097.77

2011-12 34 5892.92

2012-13 33 6497.03

2013-14 38 1204.82

2014-15 46 3019.46

2015-16 (till 30thNovember 2015) 44 9631.76

Source: SEBI Handbook of Statistics, 2015.


However, as per Annual Report 2016-17 of SEBI, bank/financial institutions/ financeindustry raised the largest amount in the industry-wise classification of resourcemobilization and contributed 65.2 per cent to the total resources mobilized through 26issues, as compared to a contribution of 32.4 per cent through 22 issues in 2015-16.

Now it will be interesting to observe the IPO issue trend of Indian banking sector till2030. In order to ascertain the forecasted values of IPO based upon the abovementioned IPO issue statistics, parabolic trend equation is used.

Presuming the period 2015-16 (till 30th November, 2015) as complete period

Applying Parabolic Trend Equation

Yc = a +bX +cX²

The values of a, b and c can be obtained by solving the following equations: Y = Na + b X +c X² (i) XY = a X + b X² + c X3 (ii) X²Y = a X² + b X3 + c X4 (iii)

Years IPO issues X X² X3 X4 XY X²Y

(Y)

2003-04 19 -6 36 -216 1296 -114 684

2004-05 23 -5 25 -125 625 -115 575

2005-06 76 -4 16 -64 256 -304 1216

2006-07 76 -3 9 -27 81 -228 684

2007-08 84 -2 4 -8 16 -168 336

2008-09 21 -1 1 -1 1 -21 21

2009-10 39 0 0 0 0 0 0

2010-11 52 1 1 1 1 52 52

2011-12 34 2 4 8 16 68 136

2012-13 33 3 9 27 81 99 297

2013-14 38 4 16 64 256 152 608

2014-15 46 5 25 125 625 230 1150

2015-16(till 30thNov. 2015) 44 6 36 216 1296 264 1584

Y= X= X²= X3= X4= XY= X²Y585 0 182 0 4550 -85 = 7343

Note: The IPO issue till November 2016 have been considered to be a completefinancial year.


Forecasting of IPO values using Parabolic Trend Equation

Applying Parabolic Trend Equation

Yc = a +bX +cX²

The values of a, b and c can be obtained by solving the following equations:

Y = Na + b X +c X² (i)

XY = a X + b X² + c X3 (ii)

X²Y = a X² + b X3 + c X4 (iii)

Years IPO Values X X² X3 X4 XY X²Y (INRCrore) Y

2003-04 3191.10 -6 36 -216 1296 -19147 114880

2004-05 14662.32 -5 25 -125 625 -73312 366558

2005-06 10797.88 -4 16 -64 256 -43192 172766

2006-07 23706.16 -3 9 -27 81 -71118 213355

2007-08 41323.45 -2 4 -8 16 -82647 165294

2008-09 2033.99 -1 1 -1 1 -2034 2034

2009-10 24948.31 0 0 0 0 0 0

2010-11 33097.77 1 1 1 1 33098 33098

2011-12 5892.92 2 4 8 16 11786 23572

2012-13 6497.03 3 9 27 81 19491 58473

2013-14 1204.82 4 16 64 256 4819 19277

2014-15 3019.46 5 25 125 625 15097 75487

2015-16 9631.76 6 36 216 1296 57791 346743(till 30thNovember2015)

Y = X X²= X3= X4= XY = X²Y180006.97 = 0 182 0 4550 -149368 =

1591537

1,80,007 = 13a + 182c (i)

-1,49,368 = 182b (ii)

1591537 = 182a + 4550c (iii)

Solving equation (ii), we get;

b = -821

Solving equations (i) and (iii), we get:

1,80,007 = 13a + 182c (i)


1591537 = 182a + 4550c (iii)

Multiplying equation (i) by 14

25,20,098 = 182a + 2548c (iv)

Now solving equations (iii) and (iv):

15,91,537 = 182a + 4550c (iii)

25,20,098 = 182a + 2548c (iv)--------------------------------------928561 = 2002c

c = -464

Substituting the value of c in equation (i):

180,007 = 13a + 182 (-464)

a = 264,455

Therefore, the parabolic trend equation is:

Yc= 264,455 – 821X – 464X²

Forecasting IPO issue (value wise) till 2030

Years Computation IPO Values (INR Crore)

2017 264,455 – 821 (7) – 464 (49) 235,972

2018 264,455 – 821 (8) – 464 (64) 228,192

2019 264,455 – 821 (9) – 464 (81) 219,482

2020 264,455 – 821 (10) – 464 (100) 209,845

2021 264,455 – 821 (11) – 464 (121) 199,280

2022 264,455 – 821 (12) – 464 (144) 187,787

2023 264,455 – 821 (13) – 464 (169) 175,366

2024 264, 455 – 821 (14) – 464 (196) 162,017

2025 264,455 – 821 (15) – 464 (225) 147,740

2026 264,455 – 821 (16) – 464 (256) 132,535

2027 264,455 – 821 (17) – 464 (289) 116,402

2028 264,455 – 821 (18) – 464 (324) 99,341

2029 264,455 – 821 (19) – 464 (361) 81,352

2030 264,455 – 821 (20) – 464 (400) 62,435

Note: a) Figures are rounded off to nearest decimals.


Deciphering IPO Performance

It can be observed that the fiscal 2006-07 have witnessed an upsurge in public equityofferings compared to the periods, 2003-04, 2004-05 and 2006-07. In fact, the equitymobilization of 2006-07 was the highest ever in the history of Indian capital market.The highest in the 90s was INR 13,443 crore that was raised in 1994-95. The mobilizationin the year could have been higher but due to two secondary market crashes during theyear which compelled temporary shelving of IPOs as well as absence of divestments.Significantly, the year witnessed the largest equity IPO ever that of Cairn India (INR5789 crore). It is essential to note that 2006-07 marked the quality offerings. Thequality factor was evident through the total domination of existing companies, in majorityof cases with renowned promoters. There was no market for IPOs from greenfieldprojects or new promoters. The response from the public Moreover, strict entry normsand better vetting by stock exchanges, SEBI and QIBs have played a crucial role inimproving the quality of issues. The response from the public to the equity issues ofthe year was excellent. The important factor responsible for the good performance ofthe primary market can be accorded to buoyant secondary market almost throughoutthe year. Further economic renaissance and stable political climate By applying parabolictrend equation for forecasting both IPO volume and value till 2020 and 2030 respectively,it can be seen that there may be a drastic fall in IPO issues in the near future.

Now looking into IPO issue trend of 2008, it can be said that “History surely repeatsitself”. Every time the secondary market tanks, the primary market goes for a catnap.Since end- January 2008, when the Sensex first tumbled, the IPO market got hit badly.Between February and August, merely 25 IPOs, all small ones, which hit the market,raised a paltry INR 4,345 crore. In 2007 between February and August there were 65IPOs raising INR 32,993 crore. During good times, the last bottleneck is SEBI approvaland a company would typically launch the IPO as soon as it receives the approval.However, in 2008 as many as 22 renowned companies which were planning to raiseINR 16,539 crore, have allowed their IPO approvals to lapse. This included big namessuch as, Jaiprakash Ventures (INR 4000 crore), Reliance Infratel (INR 4000 crore), UTIAsset Management (INR 2000 crore), Acme Telepower (INR 1200), MCX (INR 600crore) and Vascon Engineers (INR 350 crore). Further, the withdrawal of IPOs by 8


companies which planned to raise collectively INR 4,772 crore, added to the list ofwithdrawal of IPOs .

Bookbuilding issues continued to dominate. Of the 38 issues, 33 issues (87 percent)were made through this trajectory, collectively mobilizing over than 99 percent of theyear’s amount. On another front, according to PRIME DATABSE (InformationManagement Specialist), there was a continued dominance of fresh capital, which typicallygoes into productive assets as against offers for sale where the proceeds goes to theseller- promoters, funds and other investors- and not to the company. Fresh capitaltook a 94 percent share at INR 15,941 crore, though down by 63 percent from INR43,065 crore in 2007. Offers for sale raised a meagre INR 968 crore in 2008, incomparison to INR 2077 crore in 2007.

According to PRIME DATABASE, the mobilization in 2008 could have been assisted byPSU divestments. In 2004, an impressive INR 16,819 crore was accounted by PSUdisinvestments, which dropped to nil both in 2005 and 2006 and was INR 995 crore in2007. In 2008, Rural Electrification Corporation (REC) witnessed an insignificantdivestment of INR 820 crore.

Exploring equity issues in 2009, mobilization of resources through rights issue registereda substantial decline in fiscal 2008-2009. According to Mr.Prithivi Haldea of PRIME, thecountry’s renowned database on the primary capital market, by amount, the yearwitnessed merely INR 12,622 crore being raised, which was lower by 61 percent thanINR 32,518 crore was raised in 2007-08. However, it is to be noted that more than halfof the 2007 mobilization came through SBI rights issue while another 28 percent wastaken up by Tata Steel.

By number, according to PRIME DATABASE, the year saw merely 23 companies usingthe rights route. This was lower by 23 percent over the previous year that had witnessed30 issues (2006-07: 38 issues).

The largest issue of 2009 came from Hindalco (INR 5,048 crore). The other INR 1000crore plus issues came from Tata Motors (4146) and Dish TV (1140). The response tothe two biggest issues, i.e. Hindalco and Tata Motors was dismal, leading to devolvement.

The fiscal 2009-10 promised some action on the rights front. 20 companies applied foror obtained SEBI approval for raising INR 4198 crore. Some of the important onesinclude, Fortis Healthcare (INR 1000 crore), Magnum Ventures (INR 60 crore), RamcoSystems (INR 131 crore), Religare Enterprises (INR 1850 crore), SGN Telecoms (INR 50crore), Syncom Formulations (INR 100 crore), Tebma Shipyards (INR 350 crore) andWire and Wireless India (INR 450 crore). In addition, there were nearly 45 companieswho were all set to tap the rights market. These include Bharat Forge (INR 400 crore),Birla Power Solutions, Chettinad Cement (INR 250 crore), DCW, Dewan Housing Finance(INR 105 crore), ECE Industries (INR 50 crore), Gremach Infrastructure Equipments,Gujarat NRE Coke, Horizon Infrastructure (INR 669 crore), Infomedia 18, JaiprakashAssociates (INR 1800 crore), JSL (INR 500 crore), Max India (INR 650 crore), SadbavEngineering (INR 125 crore), Shopper’s Stop (INR 300 crore), Suzlon Energy (INR 1800crore), Swaraj Mazda (INR 80 crore) and Tata Communications (INR 1000 crore).

Now taking the case of 2010-11, i.e. when the said financial year was nearing end, it


witnessed raising of INR 46,267 crore through public equity issues. The public issue inthe mentioned fiscal year could have been higher but for the deferment of some giantPSU offerings and the continuing volatility in the secondary market, especially in the lastquarter of the 2010-11, compared to INR 29,514 crore raised in the 3rd quarter, the 4thquarter witnessed mobilization of paltry amount of INR 4,468 crore. The year also fellshort of INR 52,219 crore, the highest amount that had ever been raised, being in2007-08. PSUs and PSU banks dominated the year with a total raising of INR 27,537crore or 60 percent of the total amount. This was, however, lower than INR 31,082crore that had been raised by them in 2009-10, which was the highest ever. Of thetotal amount of INR 27,537 crore, INR 22,763 crore was through divestments and INR4,774 crore through fresh capital. A total of 7 PSUs forayed into the market during theyear, led by the largest ever IPO in the Indian market that of Coal India (INR 15199crore) which solely accounted for 33 percent of the year’s mobilization. The other IPOswere from MOIL (INR 1,238 crore), SJVN (INR 1,063 crore), and PSB (INR 471 crore).The balance 3 were FPOs- PGCIL (INR 7442 crore), SCIL (INR 1165 crore) and EIL (INR960 crore).

Thus, a total of 57 public issues forayed into the market during the year, compared to44 issues in the preceding year, thereby registering a 30 percent increase.

During 2016-17, Rs.62,067 crore was mobilized through 122 public and 12 rights issuesas against Rs. 57,866 crore raised in 2015-16 through 94 public and 13 rights issues. In2016-17 was the year of the IPO market as there was a quantum jump in the numberof IPOs and the amount mobilized by them.

IPOs in 2017(until October 27, 2017) a record 80% or Rs. 37,089 crore has gonetowards offer for sale in these public issues with just Rs. 9150 crore going to thecompanies in the form of fresh capital issued.

***


Prologue

There are various types of IPOs describing the different management and ownercompensation contracts in firms

(a) Plain Vanilla IPO : It is issued by a privately held company, mostly owned bymanagement, who want to procure additional funding and ascertain thecompany’s fair market value.

(b) Venture Capital backed IPO : A venture capital backed IPO refers to a companyin which management has sold its shares to one or more groups of privateinvestors in return for funding and advice. This offers an effective incentivescheme for venture capitalists to implement their exit stratagem after theyhave successfully transformed a firm in which they invested so that it is financiallyfeasible in the market.

(c) Reversed-leveraged buyout : In a reversed-leveraged buyout, the proceeds ofthe IPO are utilized to pay off the debt accumulated when a company wasprivatized after a previous listing on an exchange. This process assist ownerswho hold majority of shares to privatize their publicly trading firms, which areundervalued in the market, therefore realizing financial gains after the publicwas informed of the high intrinsic value of the private firm.

(d) Spin-off IPO : A Spin-off IPO indicates the process whereby a huge companycarves out a stand-alone subsidiary and sells it to the public. A spin-off mayalso offer owners of the parent firm and hedge funds the opportunity to capitalizemispricing in both the subsidiary and parent if the market is not efficient. Forinstance, in United States the spin-off of Bid by Creative Computers in 1998,which enabled arbitragers to capitalize the mispricing between the two listedcompanies.

The other important kinds of IPO issues are- i) Fixed Price Issues and ii) Book BuildingIssues

(i) Fixed Price Issues : In Fixed Price issues, the price at which the securities areoffered and would be allotted is made known in advance to the investors. Thedemand for the securities offered is known only after the closure of the issue.Hundred percent payment is needed to be made by the investors at the timeof application. Fifty percent of the shares offered are reserved for applicationsbelow INR must be Rs. 2 lakh and the balance for higher amount applications.Fixed price offerings were the preferred mechanism until 2003 in Indian CapitalMarket. After 2003, Book Building has dominated IPOs.

Chapter -2

IPO Trajectory of Banks & Critical Aspects

16


(ii) Book Building Issues : Book Building is essentially a process embraced by thecompanies procuring capital through Public Offerings- both Initial Public Offers(IPOs) and Follow-on Public Offers (FPOs) to assist in price and demanddiscovery. It is a mechanism where, during the period for which the book forthe offer is open, the bids are collated from investors at various prices, whichare within the price band specified by the issuer. The process is directed towardsboth the institutional as well as the retail investors. The issue price is ascertainedafter the bid closure based on the demand generated in the process.

The steps involved in the process are as follows-

(i) The issuer who is planning an offer nominates lead merchant banker (s) as“book runners”.

(ii) The issue specifies the number of securities to be issued and the price band forthe bids.

(iii) The issue also appoints syndicate members with whom orders are to be placedby the investors.

(iv) The syndicate members input the orders into an ‘electronic book’. This processis termed as “bidding” and is similar to open auction.

(v) The book normally remains open for a period of normally for 3 working daysand can be kept open for a maximum of 10 working days.

(vi) Bids have to be entered within the specified price band.

(vii) Bids can be reversed by the bidders before the book closes.

(viii) On the close of the book building period, the book runners assess the bids onthe basis of the demand at various price levels.

(ix) The book runners and the issuer decide the final price at which the securitiesshall be issued.

(x) Generally, the numbers of shares are fixed, the issue size gets frozen based onthe final price per share.

(xi) Allocation of securities is made to the successful bidders. The rest receiverefund orders.

India’s Experience with IPO Mechanisms

India has experimented with numerous IPO mechanisms. Commencing in September1999, issuers could select between the fixed price and book building methods. Overthe years, there have been variants of book building in the Indian capital market. Forexample, in November 2005, the underwriters power over IPO allocations were rescindedeven in “book-built” IPOs. In 2009, book building came with the alternative of having“anchor1” investors in the first stage prior to the public offer. Quite recently, an SMEplatform was launched for small firms wishing to issue IPOs. Fixed price offerings werethe preferred trajectory until 2003. Post 2003, book building has dominated IPOs. Thisis not unusual; the dominance of book building is observed in all the markets where itis permitted.


IPO Grading

In 2007, the Securities and Exchange Board of India (SEBI) made it mandatory for corporatehouses to receive IPO “grades” from independent rating companies. In December2013, IPO grading was made optional keeping in view the recommendations of theFinancial Stability Board to decrease dependency on credit rating agencies. IPO gradingact as a summary of the voluminous disclosures needed in IPOs. Alternatively, suchgrades can generate additional information because of the new entities involved inassigning grades.

Investment decisions for IPOs currently demands analyzing complex documents, whichis a challenge for investors, particularly retail investors. IPO grading aims to offer anindependent, unbiased view of the company’s fundamentals, enabling the investor tobenchmark new issues with their peers in the equity universe.

SEBI’s Regulations suggest that the grading of IPOs is a service targeted at facilitatingevaluation of equity issues offered to the public. The Grade allocated to any individualIPO is an assessment of the “fundamentals” of the issuer concerned on a relativegrading scale, in relation to the other listed securities in India. The grading is assignedon a five-point scale with a higher score signifying robust fundamentals and vice-versaas mentioned below-

(a) IPO grade 1: Poor fundamentals

(b) IPO grade 2: Below average fundamentals

(c) IPO grade 3: Average fundamentals

(d) IPO grade 4: Above average fundamentals

(e) IPO grade 5: Strong fundamentals

The grading exercise lay stress on assessing the prospects of the industry in which thecompany functions, and the company’s competitive strengths that would permit it toaddress the risks inherent in the business(es). In case the IPO proceeds are planned tobe utilized for initiating a project, either Greenfield or Brownfield, the grading evaluatesthe risks innate in such projects, the capacity of the company’s management to executethe same, and the potential advantages accruing from the successful completion of theprojects in terms of profitability and return to shareholders.

Accordingly, IPO Grading approach observes the following key elements:

(i) Business and Competitive Position : The alignment between industryopportunities, the company’s strategy and objectives.

(ii) Financial Position and Prospects : Forward looking evaluation of significantfinancial indicators like, Return on Equity (ROE), Earnings per Share (EPS), P/EMultiple, Growth in Profit, relevant for an equity investor.

(iii) Management Quality : An assessment of the capability of the management totackle uncertainty in terms of capitalizing on future business opportunity andalleviating the impact of contingencies.

(iv) Corporate Governance Practices : An assessment of the company’s governance


framework to determine if it is structured such that the risks and rewards ofbusiness are equally available to all shareholders.

IPO grading is one time evaluation conducted before the IPO issue and depends heavilyon the draft prospectus filed with SEBI. Generally, grading is conducted looking atroughly a three year time horizon and involve a detailed appraisal of the differentquantitative and qualitative yardsticks of the issuer. While growth prospects of the industryand financial robustness are some of the quantitative measures, qualitative parameterslike, management capabilities also provide critical input in deciding a grade. For instance,ICRA assigned “IPO Grade 3” to the IPO of United Bank of India, meaning ‘averagefundamentals’ and CARE Ratings assigned “IPO Grade 4” to the IPO of Punjab & SindBank, implying ‘above average fundamentals’.

IPO Route - The Case of Public Sector Banks

Banks were nationalized in 1969 with an objective that the banking sector needs toreach the poor sections of society, and that farmers in India will get access to financialservices. More specifically, loans sure enough, over the years, RBI has set priority sectorlending targets that even private sector banks have to follow. Banks were used as a toolto drive national policy and, in some cases, political agendas – with the explicitexpectation that GoI would infuse capital regularly to support any loan losses.

But, perspectives are changing now. While the GoI continues to promise capital infusion,it also requires banks to raise money from the market. The GoI’s newfound thinking ofletting PSBs raise their own capital, and thereby compelling them operate under marketchallenges, is directionally correct. A wave of bank IPOs leads to series of pertinentimpacts to the financial system. The proceeds of IPOs are significant source of capitalfor banks that allows the expansion of bank deposits and assets. Initial public offersengender development of banks.

According to Indradhanush scheme banks were required to inject INR 1.80 trillion innear future to become well capitalized, of which the budgetary allocation for support isonly Rs.700 bn – banks will need to raise the remaining INR 1.10 trillion from themarket by FY 2019. Of the promised INR 700 bn, the GoI had already infused INR 200bn into PSB by 31 December 2015 – therefore, GoI will infuse only an incremental INR500 bn in PSBs will FY 2019.

In the past, the capital infusion process of Government of India to an extent havebeen circular flow of money, i.e. Government of India increased its stake in publicsector banks by reinvesting dividends received. Till recently, Government of Indiahave invested INR 678.3 billion in public sector banks (please refer exhibit 9).Approximately half of that was financed by public sector banks themselves throughdividends (to the extent of Government of India shareholding) and dividend distributiontax. Now the pertinent point is if public sector banks have to grow then they are leftwith two alternatives, i.e. either go for stopping of dividends or raising additionalcapital. Now stemming dividends may result into dissention among shareholders whoinvest their hard earned money with the aim of wealth maximization and being theowners of the company embrace maximum risks. So in view of this, the best optionwill be to espouse IPO trajectory.


However, capital raising for public sector banks poses two challenges- Government ofIndia needs to ensure that its stake does not enhance beyond 75% post the capitalinfusion and if banks procure capital from the market, Government of India’s sharecannot get diluted below 50%. Regulations require Government of India to reduce itsstake in listed banks to 75% or less by August 2017. This results in seven PSBs beingautomatically excluded (Government of India stake in these banks was greater than75% on 31 December 2015) from the incremental INR 500 bn Government of Indiainfusion, and another three where the infusion will have to be limited (Bank of India,UCO Bank and Vijaya Bank, where GoI stake was in between 70% and 75% on 31December 2015) unless these banks are able to dilute the Government of Indiashareholding by raising a large amount of capital from the market. Therefore, the proposedcapital infusion under Indhradhanush scheme will directly benefit only 11 of the 21listed PSBs not including SBI subsidiaries.

Impact of Global Economic Crisis on IPO Issues

About more than three decades, globalization has largely ensued based on the belief inthe self-regulatory capacity of markets without sufficient structures and systems in placeto govern the process. By mid-2007, this has resulted into appearance of large fissuresthreatening the stability of the global economy on two fronts: the sharp increase ofprimary commodity prices and the global financial crisis. The latter is the outcome ofthe global savings superfluity and the associated global macroeconomic imbalances,which evolved since the financial crisis in the 1990s that seriously disrupted economicgrowth and development in large number of emerging economies in Asia, Latin Americaand transitional economies. The flow of large savings into the United States economy,facilitated by the easy monetary condition, resulted into housing and credit boom,which ultimately ended in the sub-prime mortgage. Unsurprisingly, in the context ofcontemporary financial globalization, this seemingly localized process could not becontained within the United States financial system and rapidly spread to other importantfinancial centres.

For a year or so since mid-summer 2007, the financial mayhem, with its severe liquidityand credit crunch, seemed to be limited more or less to financial markets and institutionsin the United States and Western Europe. On the whole, the global economy managedto maintain its momentum on the back of the buoyant economic growth posted byemerging market economies as well as resource-rich developing economies that enjoyeda commodity boom. However, a series of events that hit important financial institutionson Wall Street in mid-September 2008 created tremors that shook the world and altereddrastically the serendipity and the course of the globalized economies.

The commencement of 21st century can best be described as the period of economicand financial uncertainty. This period witnessed the first crisis with the burse of dot combubble in 2000 followed by US sub-prime crisis in 2007-08 and then European debtcrisis in 2011. After the dot com bubble burst in the US, monetary policy in US andother developed economies was considerably eased. Policy rates in the US touched onepercent in June 2003 and were held constant around that levels for an extended periodup to June 2004. In the subsequent period, the rescission of monetary accommodationwas quite gradual. An empirical assessment of the US monetary policy reveals that theactual policy during the period 2002-06, particularly during 2002-04, was substantially


looser than what a simple Taylor rule would have required. This was a huge deviationfrom the Taylor Rule. In the post dot com period excessively liberal monetary policypushed up the consumption and investment in the US. With such low nominal and realinterest rates, asset prices registered robust gains, especially in housing and real estate,which gave further stimulus to consumption and investment through wealth effects.Therefore, aggregate demand consistently surpassed domestic output in the US and,given the macroeconomic identity, this was reflected in large and rising current accountdeficits in the US over the period.

The gargantuan domestic demand of the US was fulfilled by the rest of the world,particularly China and other East Asian economies, which offered goods and services atrelatively low costs resulting into growing surpluses in these countries. Sustained currentaccount surpluses in some of these Emerging Market Economies (EMEs) also reflectedthe lessons learnt from the Asian financial crisis.

Having the set the tone of global economic turmoil, it is important to understand itsimpact on Indian capital market and on IPO issues.

During the bull rally (2003-2007) there was considerable enthusiasm. This was the timewhen interest rates were low. Credit was available and that too cheaply. Not just that,corporate profits were growing at a robust rate. Stock markets were registering impressivegains. Indian capital markets in 2007-08, thus featured a developed regulatory framework,a modern market infrastructure, a steadily rising market capitalization and liquidity,better allocation and mobilization of resources, a fast developing derivatives market, asound mutual fund industry, and enhanced issuer transparency.

But the global economic crisis of 2008-09 created tremors. The colossal liquidity, notastonishingly, resulted into asset bubbles that finally burst. Indian capital market haswitnessed its worst time with the global financial crisis. The renowned stock index, i.e.,Sensex declined to its levels achieved in December 2005. Similar decline was alsoobserved for S&P CNX Nifty index. With the volatility in portfolio flows having beenlarge during 2007 and 2008, the effect of global financial turmoil has been felt particularlyin the equity market. Indian stock prices got badly affected by foreign institutionalinvestors (FII) withdrawals. FIIs had invested more than INR 10,00,000 crore betweenJanuary 2006 and January 2008, driving the Sensex 20,000 over the period. But fromJanuary, 2008 to January 2009, FIIs exited from the equity market partially as a flight tosafety and partly to meet their redemption obligations at home. These withdrawalsdrove the Sensex down from over 20,000 to less than 9,000 in a year. It seriouslycrippled the liquidity in the stock market. Stock prices tanked to more than 70 percentfrom their peaks in January 2008 and some have even lost to approximately 90 percentof their value. This abysmal performance at Dalal Street wiped out the primary marketdecreased by 63%. In 2007, 106 initial public offerings (IPO) were issued and raised atotal amount of nearly US$11 billion. On the contrary, merely 38 IPOs were issued in2008 and resulted in accumulations of only US$3.8 billion.

Now given the presence of unutilized liquidity in the global market, and India beingone of the few countries with positive growth, FIIs once again started flowing back toIndia (please refer exhibit 8). During the first two months of the financial year 2009,i.e. April and May, Indian equity markets received net FII inflows of more than US$5billion. Consequently, equity markets partially gained their lost value. However, due to


prevailing uncertainties, the primary market still not shown any sign of recovery. Mostof the corporate houses put their IPOs on hold and merely one IPO was issued in 2009.

The years 2003-2004 witnessed an active market for IPOs. Though the number of IPOswas small, the amounts being raised were increasing. However, due to the globalmeltdown and its deleterious impacts on our economy, the amount mobilized in 2008-09 nosedived to a paltry INR 2034 crore, through just 21 small IPOs.

In the secondary market too, Indian stock prices were severely battered by foreigninstitutional investors (FIIs) withdrawals. FIIs had invested more than INR 10,00,000crore between January 2006 and January 2008, driving the Sensex 20,000 over theperiod. But from January, 2008 to January, 2009, FIIs withdrew from the equity marketpartially as a flight to safety and partly to address their redemption obligations at home.These withdrawals drove the Sensex from over 20,000 to below 9000 in a year. Itseriously crippled the liquidity in the stock market. The stock prices have tanked tomore than 70 percent from the peaks in January 2008 and some have even lost toapproximately 90 percent of their value. This event left with no safe haven for bothretail and institutional investors. Consequently, the primary got derailed and the secondarymarket was in the deep abyss.

Equity values were at very low levels and numerous established corporate houses wereunable to compete their rights issues even after fixing offer prices below related marketquotations at the time of announcement. Subsequently, market took a nose dive, i.e.below issue prices and shareholders were considering purchases from the cheaperopen market or deferring fresh investments. This scenario disturbed the plans ofcompanies to raise resources in various forms for their ambitious projects involvingheavy expenditures.

Despite the scale down of popular capital market indices up to the first quarter of 2009,Indian stock markets then provide the proofs of robust resistance to global financialcontagion. The year 2009-10 witnessed an upsurge in turnover on the exchanges,mainly on account of recovery of the global financial markets. The turnover on the NSEshot up by 50.36% in 2009-10 compared with 2008-09 and that on the BSE it enhancedby 25.34% over the same period. The average daily turnover on the NSE stood at US$3.5 billion in 2009-10 compared to US$ 2.0 billion in 2008-09. Though the averagedaily turnover on the BSE rose to US$ 1.1 billion in 2009-10 compared to US$ 2.0 billionin 2008-09. In 2009, market was in a recovery mode; but 2010 it consolidated. Thefundamentals were strong. With average 8.9% growth in the first three quarters of2010 the economy was well poised to rush into 2011 with good performance. By thistime, consumer demand was robust, exports were moving north and investment wasbuilding up. The year 2010-11 has been another record year for the Indian capitalmarkets with 124 IPOs (Initial Public Offerings) and FPOs (Follow on Public Offerings)and 41 QIPs (Qualified Institutional Placements). According to Bloomberg data, proceedsfrom fresh issues (IPOs) by Indian corporate houses in 2010 surpassed even the levelstouched in 2007. The Government made a strong mark on the markets, raising substantialcapital with string of IPOs and FPOs. Till March 2011, 124 IPOs had accounted for INR51000 crore (US$11.3 billion) in capital raised, averaging close to a billion dollar everymonth. This along with 41 QIPs that raised approximately INR 19,722 crore (US$4.3billion) implied that Indian companies rose more than INR 70,000 crore (US$15.5


billion) in the 2010-11 financial year. Thus, it can be opined that India’s capital markethas displayed good resilience and rapid recovery from the global financial meltdown.

At this juncture, it is also essential to have a look on the global IPO issue scenario acrossvarious countries and their respective sectors, as well as the Indian scenario. During2009, the year of global meltdown at its zenith, China dominated the largest IPO list,representing seven of the ten initial public offerings. Top five IPOs in 2009 includes twoconstruction firms from China and three financial companies, two from Brazil and onefrom China.

Banco Santander Brasil SA’s $8.1 billion was the biggest IPO of the year across theglobe in 2009, followed by $7.3 billion IPO of China State Construction. The largestIPO of 2009 (Banco Santander Brasil SA, Brazil, $1.8 billion) was merely 45% (in termsof value) of the largest IPO of 2008, i.e. Visa amounting to US$ 17.86 billion, butequivalent to largest IPO of 2007- VTB Bank, Russia $8 billion. Financial sector was thepick with 4 largest IPOs in top 10, contributing 47% of the top 10 IPO proceeds.

According to the report of OECD, globally, the average annual amount of equity raisedthrough initial public offerings (IPOs) by non-financial companies has declined in thelast 20 years. Also the average number of companies who make an IPO has declined.

As for advanced economies shows the annual average number of companies that madean IPO in the period 1994-2000 was 1,152. That number fell to 853 in the period2001-2007 and to just 432 per year in the period 2008-2014. This decrease in thenumber of companies has been accompanied by a significant decline also in the realvalue of money raised through IPOs over the three periods; from USD 145 billion in theperiod 1994-2000, to USD 87 billion in the period 2001-2007 to USD 63 billion in theperiod 2008-2014.

During the same period however, non-financial companies in emerging marketssignificantly increased their use of public equity markets. The total amount of capitalraised almost doubled in real terms from USD 24 billion in the period 1994-2000 to 45billion in the period 2001-2007. In the period 2008-2014 it increased another 40%,reaching an annual average of USD 65. The number of emerging market companiesthat made an IPO has also considerably increased in the same period.

Now taking the case of India most of IPOs in 2009 were subscribed at higher band.Among the different sectors that issued IPOs, apart from Banking and Financial Servicessector are: Education, Industrial, Hospitality, Outsourcing, Energy & Power etc. Energy& Power registered a substantial hike.

The Litmus Test

Kruskal-Wallis Test or H-Test

This non-parametric test will assist to know whether there is a significant difference inthe quantum of IPO issues of Banking/ Financial Institutions sector vis-a-vi with otherkey sectors of the economy pre and post Global Economic Crisis.

In total three sectors being considered for the test, the first being Banking/ FinancialInstitutions sector and other two are: Cement & Construction and Engineering. The


raison d'être for selecting Cement & Construction and Engineering sectors along withthe Banking/Financial Institutions sector (the sector under study) are:

(a) The mentioned sectors play a crucial role in engendering development ofinfrastructure

(b) In other sectors, the IPO activity was not much prominent.

Null Hypothesis (H0) : The Global Economic Crisis does not impacted IPO issue of Banking/Financial Institutions sector vis-a-vis Cement & Construction and Engineering sectors.

Alternative Hypothesis (H1) : The Global Economic Crisis had impacted IPO issue ofBanking/Financial Institutions sector vis-a-vis Cement & Construction and Engineeringsectors.

Note : The demarcating period considered for pre and post Global Economic Crisis is2008-09, as in this year neither there have been IPO issue in Banking/Financial Institutionssector and Engineering sector and 03 IPO issue in Cement & Construction sector.Moreover, based upon various articles and research papers, it can be said that duringthe mentioned period, the Global Economic Crisis was at its pinnacle.

Years Banking/Financial Cement & EngineeringInstitutions sector Construction sector sector

2000-01 13 02 02

2001-02 14 02 04

2002-03 13 01 02

2003-04 11 01 01

2004-05 12 02 03

2005-06 12 11 06

2006-07 05 13 02

2007-08 06 27 05

2009-10 06 08 01

2010-11 18 03 05

2011-12 20 02 01

2012-13 07 01 02

2013-14 14 04 05

April 1st2013-December 2013 01 03 02

April 1st 2014-December 2014 04 03 01


IPO issues Ranks

1 11 1.51 2.51 3.51 4.51 5.51 6.51 7.52 9

2 9.5

2 10.5

2 11.5

2 12.5

2 13.5

2 14.5

2 15.5

2 16.5

3 18

3 18.5

3 19.5

3 20.5

4 22

4 22.5

4 23.5

5 25

5 25.5

5 26.5

5 27.5

6 29

6 29.5

6 30.5

7 32

8 33

11 34

11 34.5


12 36

12 36.5

13 38

13 38.5

13 39.5

14 41

14 41.5

18 43

20 44

27 45

Banking/Financial Institutions Cement & Construction Engineering sectorsector Ranks sector Ranks ranks

38 9 12.5

41 9.5 23.5

38.5 1.5 13.5

34 2.5 4.5

36 10.5 20.5

36.5 34.5 30.5

25 39.5 14.5

29 45 25.5

29.5 33 5.5

43 18 26.5

44 11.5 6.5

32 3.5 15.5

41.5 22.5 27.5

01 18.5 16.5

22 19.5 7.5

R1 = 491 R2= 278.5 R3= 250.5

Here N1= 15, N2=15 and N3=15

IPO issues Ranks


Therefore, N= N1+N2+N3 = 15+15+15 = 45

Also R1 =491, R2 = 278.5 and R3= 250.5

H = 1)N(N12 [R1²/N1 + R2²/N2 + R3²/N3] – 3 (N +1)

H = x46 45

12 [(491)²/15 + (278.5)²/15 + (250.5)²/15] – 3 x 46

H = 207012

[16072 + 5171 + 4183] - 138

H = 9.39

Degrees of freedom = k-1 = 3-1=2

Also level of significance : a = 0.05

Therefore ψ² (for 2 degrees of freedom and α = 0.05) = ψ 0.05, 2 = 5.991

Decision : Reject H0 if H> ψ²0.95

Now 9.39 > 5.991

Thus, the null hypothesis H0 is rejected and the alternative hypothesis H1 isaccepted. It can be concluded that the Global Economic Crisis had impacted IPOissue of Banking/Financial Institutions sector vis-a-vis Cement & Constructionand Engineering sectors.

MANN - WHITNEY U-TEST

This non-parametric test will help to comprehend that whether there is a significantdifference or not in quantum of IPO issue of Banking/ Financial Institutions sector preand post Global Economic Crisis.

Null Hypothesis : H0: µ1 = µ2, i.e., there is no significant difference between theIPO issues (in numbers) of Banking/Financial Institutions sector pre and post GlobalEconomic Crisis.

Alternative Hypothesis : H1: µ1 µ2, i.e., there is a significant difference betweenthe IPO issues (in numbers) of Banking/Financial Institutions sector pre and post GlobalEconomic Crisis.

Level of significance : Here a = 0.05

Note : The demarcating year for comprehending the impact on IPO issues pre and postGlobal Economic Crisis is 2008-09, as from the Handbook of Statistics of Securities &Exchange Board of India, the Capital Market Regulator of India, it can be observed thatin the above mentioned period the IPO issues are nil and going by various reports or


articles, it can be said that the economic turmoil was at its acme during the said period(please refer the website: http://www.sebi.gov.in/sebiweb/home/list/4/32/0/0/Handbook-of-Statistics )

Pre-Crisis 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-Periods 08

IPO Issue 13 14 13 11 12 12 05 06

Post Crisis 2009- 2010- 2011- 2012- 2013- April April –Periods 10 11 12 13 14 2013 – 2014-

December December2013 2014

IPO Issue 06 18 20 07 14 01 04 –

The observations are arranged in ascending order and ranks from 1 to 14 are assigned.

Original Data Rank

1 14 25 36 46 4.57 611 712 812 8.513 1013 10.514 1114 11.518 1320 14

The ranks of the observations belonging to the smaller samples are underscored (put inbold form).

R1 = 3+4+7+8+8.5+10+10.5+11 = 62

R2 = 1+2+4.5+6+11.5+13+14 =52

Also n1 = 8; n2 =7

Therefore, U-Statistic: U = n1n2 + 2

1)(nn 11 - R1

http://www.sebi.gov.in/sebiweb/home/list/4/32/0/0/


= 8x7 + 2

9 x 8 - 62

= 56 + 2

72- 62

U = 56+36 - 62 = 30

Mean of U = µu = n1n2/2 = 8 x 7/2 = 28

Variance of U = ²u = 12

1) n (n )n x (n 2121

=12

1) 7 (8 7) x (8

= 75

u = 75 = 8.6

As one of the rule in MANN WHITNEY U-Test suggest that if n1 and n2 are both atleastequal to 8, it turns out that the distribution of U is nearly normal and one could use thestatistic Z, where

Z= σuu μ- U

is normally distributed with mean 0 and variance 1.

Since, in this case, the total of n1 and n2 equals to 14 (8+6), i.e. greater than 8, theabove mentioned statistic Z can be applied

Z = 8.6

2830

Z = 0.2325

The table value Za at a= 0.05 is 1.96

Decision: The null hypothesis is accepted as the calculated value of ¦Z¦is less than thetabled value of ¦Z α¦. Therefore, there is no significant difference in the IPO issues(quantum wise) of Banking / Financial Institutions sector pre and post Global EconomicCrisis.

***


Prelude

This chapter aims to study the impact of issue of initial public offers by the banksconsidered for the analysis on their key financials, i.e. Reported Net Profit After Tax(PAT); Return on Assets and also to judge the IPO performance in terms of returnsgenerated post listing of IPO. The trigger to delve deep into the IPO performance ofselected banks emerge from the fact that banks are fulcrum of an economy and theirwell being determines economic development. Second, equity shareholders who arethe owners of the business and embrace the maximum risks needs to be assured thattheir investments are secured and there will be maximization of wealth. Third, it is alsoto be ascertained that whether the capital raised through equity trajectory or any othersource is fruitful or not, as procurement of capital entails cost in terms of its impact ona key financial of a business organization, i.e. Reported Net Profit After Tax (PAT) andanother important financial parameter- Return on Assets (ROA).

As mentioned above that equity shareholders being the maximum risk bearer expectgainful returns on their investments. In this regard, it is essential to find out whetherpost IPO listing returns are contributing towards wealth maximization ofshareholders.

Keeping these vital points in view, the ensuing paragraphs focus upon the correlationbetween value of IPOs issued by various public and private sector banks and theirimpact on the Reported Net Profit After Tax (PAT). Similarly, an endeavour has beenmade to ascertain whether there is a significant difference or not on another key financialparameter, i.e. Return on Assets (ROA) of public and private sector banks. Finally, withthe assistance of raw return or initial return and market adjusted excess return an attempthave been made to comprehend the returns generated on the stocks of the selectedpublic and private sector banks considered for the study.

Statistical and Financial Tools

(a) Karl Pearson’s Co-efficient of Correlation - Correlation refers to sympatheticmovement of variables either in the same or in the opposite directions. Simplecorrelation deals with co-variation of two variables while multiple and partialcorrelations involve a study of co-variation between more than two variables.The relationship between variable is established and measured quantitativelywith a view to making estimates based on them.

The usage of this statistical tool will assist us to ascertain the correlation between

Chapter -3

Gauging IPO Performance

30


the quantum of IPOs issued in the Banking and industry and its resultant effecton Reported Net Profit After Tax (PAT).

(b) F-test (One Factor Model) - F-tests are named after its test statistic, F whichwas named in honour of Sir Ronald Fisher. The F-statistic is simply a ratio of twovariances. Variances are a measure of dispersion, or how far the data are scatteredfrom the mean. Larger values represent greater dispersion. Variance is thesquare of the standard deviation.

For us humans, standard deviations are easier to understand than variancesbecause they’re in the same units as the data rather than squared units.However, many analyses actually use variances in the calculations.

F-statistics are based on the ratio of mean squares. The term “mean squares”may sound confusing but it is simply an estimate of population variance thataccounts for the degrees of freedom (DF) used to calculate that estimate.

Despite being a ratio of variances, one can use F-tests in a wide variety ofsituations. Unsurprisingly, the F-test can assess the equality of variances.However, by changing the variances that are included in the ratio, the F-testbecomes a very flexible test.

For example, you can use F-statistics and F-tests to test the overall significancefor a regression model, to compare the fits of different models, to test specificregression terms, and to test the equality of means.

This test will help us to ascertain the IPO performance of Banking sector interms of Return on Assets (ROA) of selected public and private sector banks,i.e. whether there is a significant difference or not on the mentioned variablesof selected public and private sector banks due to issuance of IPOs.

(c) Initial Return or Raw Return for the Stock : This will assist in ascertaining theimmediate return on stocks of the four banks, considered for the study, i.e. ABank, B Bank, C Bank and D Bank. A and B are listed public sector banks,whereas, C and D are listed private sector banks.

(d) Market Adjusted Excess Return : At times, there is a time lag between theoffer and trading of stock, in such a scenario, the mentioned approach is useful.Thus, in order to have more clarity regarding return on stocks assuming theremight have been delay or time lag between the trading of stocks of the aforesaidbanks, Market Adjusted Excess Return (MAER) is used.

For the calculation of market adjusted excess return the same four banks havebeen considered for the study which have been considered for computation ofinitial return or raw return for the stock.


(a) Karl Pearson’s Coefficient of Correlation and Co-efficient of Determination

IPO values of Reported Net dx = dy = dx² dy² dxdyPublic & Private Profit After Tax X - X¯ Y - Y¯Sector Banks of Public & Private(INR Crore) Sector Banks(X) (INR Crore)

(Y)

111.20 40.34 -1961 -1535 3845521 2356225 3010135

150 121.19 -1922 -1454 3694084 2114116 2794588

385+164.49+ 741.40+562.39 -1135 123 1288225 15129 -139605288+100 = + 314.13+80.21937.49 = 1698.13

240+ 240= 480 416.10+196.55= -1592 -962 2534464 925444 1531504612.65

230+3349= 3579 222.02+ 1507 284 2271049 80656 4279881,637.11= 1859.13

250+315+820+ 2,005.20+ 438.06+3120+2497+ -3.76 +541.79+1450= 8452 1,410.12+726.07=

5117.48 6380 3542 40704400 12545764 22597960

185.9+495+165 -85.26 + 675.18 + 1172 668 1373584 446224 782896+765+1633= 50.90 + 552.02 +3243.9 1,050.07= 2242.91

816+782.145 = 503.79 + 759.77 = -474 -311 224676 96721 1474141598.145 1263.56

1359.81 1,960.28 -712 385 506944 148225 -274120

480+330 = 810 508.80 + 322.36= 831.16 -1262 -744 1592644 553536 938928

ΣX= 20721.545 ΣY = 15746.83 Σdx = 1 Σdy = -4 Σdx² = Σdy² = Σdxdy =58035591 19282040 31817688

Notes:

(1) IPO values comprises of the IPO issued by Allahabad Bank, Andhra Bank, Bankof India, Bank of Maharashtra, Canara Bank, Indian Overseas Bank, PunjabNational Bank, UCO Bank, Union Bank of India, Vijaya Bank, ICICI Bank Limited,Syndicate Bank, Yes Bank Limited, Oriental Bank of Commerce, DevelopmentCredit Bank Limited, The South Indian Bank, Bank of Baroda, Central Bank ofIndia, Indian Bank, Punjab & Sind Bank.

(2) For calculation purpose, the IPO values of the Banks and their Reported NetProfit after tax have been summed up.


Coefficient of correlation: r = Σdxdy / Σdx² x Σdy²

X¯ = 20721.545 / 10 = 2072 (Rounded off)

Y¯ = 15746.83 / 10 = 1575 (Rounded off)

r = 31817688 / 58035591x 19282040

r = 31817688 / 33452124 = 0.95

Therefore, Karl Pearson’s coefficient of correlation = 0.95

Coefficient of Determination = r² = (0.95)² = 0.90

Decision: There is a strong correlation between IPO issues by banks and its impacton their Reported Net Profit After Tax. Similarly the change in Reported Net ProfitAfter Tax (dependent variable) is highly influenced by the change in IPO issues, invalue terms (independent variable), as the coefficient of determination is 0.90.

(b) F-Test (One Factor Model)

This statistical tool will assist in ascertaining the impact of issue of IPO on keyfinancials of Banking and Financial Services sector. The key financial considered forthe study is Return on Assets.

First the F-test (One Factor Model) is applied on the above mentioned variables ofselected public and private sector banks. In order to maintain anonymity the realnames of banking companies are not disclosed. However, the figures referred foranalysis have been obtained from authentic sources. The banks considered for thestudy are leading public and private sectors banks of India.

The banks considered for the study are-

(1) A Bank

(2) B Bank

(3) C Bank

(4) D Bank

(5) E Bank

(6) F Bank

(7) G Bank

(8) H Bank

(9) I Bank

(10) J Bank

Note : The period considered for the analysis is 2000-2015. Further, different banks


have come up with IPOs and FPOs at different years of the above period. Now theanalysis will be done on the aforesaid three important financial parameters on sixselected public sector banks and four private sector banks which embraced the IPOroute to ascertain whether there exists a significant difference or not on Return onAssets, Return on Equity and Non-Performance Assets of the banks considered forthe analysis. Since the banks considered for the analysis have came out with IPOs/ FPOs mostly during 2002 – 2010, but to ascertain the extended impact on Returnon Assets, the termination year considered is 2015.

Further, it is to be noted that in order to maintain anonymity of the selected banksconsidered for the study they have been given pseudo names. However, the figuresconsidered for the analysis are true and have taken from authentic sources. Bankslisted from serial number 1 to 6 are listed public sector banks and those listed from7 to 10 are listed private sector banks.

Return on Assets

Null Hypothesis (H0) : There is no significant difference on the Return on Assets ofselected Public and Private Sector Banks due to IPO issue during the period 2002-2015.

Alternative Hypothesis (H1) : There is a significant difference on the Return onAssets of selected Public and Private Sector Banks due to IPO issue during theperiod 2002-2015.

Years A Bank B Bank C Bank D Bank(Sample 1-X1) (Sample 2-X2) (Sample 3-X3) (Sample 4-X4)

2002 0.32 0.97 1.029 0.77

2003 0.59 1.99 1.24 0.98

2004 1.03 1.71 1.34 1.08

2005 1.23 1.58 1.00 1.11

2006 1.29 1.19 1.01 0.99

2007 1.11 1.13 0.85 0.94

2008 1.19 1.01 0.86 1.02

2009 0.80 0.95 0.94 1.25

2010 1.00 1.15 1.14 1.31

2011 0.95 0.00 1.19 1.17

2012 1.02 0.00 0.87 1.06

2013 0.57 0.88 0.69 0.99

2014 0.53 0.26 0.49 0.60

2015 0.27 0.34 0.49 0.50

11.9 13.16 13.14 13.77

X¯ (Mean) 0.85 0.94 0.94 0.98


E Bank F Bank G Bank H Bank I Bank J Bank(Sample (Sample (Sample (Sample (Sample (Sample5-X5) 6-X6) 7-X7) 8-X8) 9-X9) 10- X10)

0.52 0.77 0.26 - 0.78 0.95

1.05 1.01 1.13 - -2.05 0.95

-0.22 1.13 1.30 - 0.00 0.91

1.04 0.71 1.19 -0.29 -3.49 0.09

-0.22 0.72 1.01 1.32 -2.27 0.47

0.63 0.71 0.90 0.84 0.14 0.76

0.58 0.79 1.03 1.17 0.44 0.88

0.29 0.97 0.99 1.32 -1.48 0.95

0.41 1.09 1.10 1.31 -1.27 0.91

0.58 1.18 1.26 1.23 0.28 0.89

0.62 1.11 1.36 1.32 0.63 0.99

0.34 0.81 1.55 1.31 0.90 1.00

-0.96 0.68 1.64 1.48 1.17 0.92

0.20 0.47 1.72 1.47 1.18 0.51

Total 4.86 12.15 16.44 11.01 -5.04 11.18

X¯ (Mean) 0.35 0.87 1.17 1.10 -0.36 0.80

Grand Mean (X¯¯) = 0.85+ 0.94+ 0.94+ 0.98+ 0.35+ 0.87+ 1.17+ 1.10 -0.36+0.80 / 10 = 7.64.

Variance Between Samples

Sample 1 Sample 2 Sample 3 Sample 4 Sample 5 Sample 6 Sample 7 Sample 8 Sample 9 Sample 10(X¯1 - (X¯2 - (X¯3 - (X¯4- X¯5- (X¯6 - (X¯7- (X¯8 - (X¯9 - (X¯10 -X¯¯) X¯¯)² X¯¯)² X¯¯)² (X¯¯)² X¯¯)² X¯¯)² X¯¯)² X¯¯)² X¯¯)²

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

46.10 45 45 45 53.14 45.83 41.86 42.77 64 46.79

Indian Banking

Documents

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